I'm running 64-bit Windows 8.1 on a PC with 16 Gig RAM and 8 cores. I've noticed a lot of lag, e.g. all action momentarily stops and when it starts back up the game character quickly speeds across the screen. At other times when I join a multi-user session where there is a lot of action my computer will just freeze up permently. In that case I can use Ctrl+Alt+Del to get to Task Manager and kill the Diablo III process.

Any ideas what might cause that problem? Is it more likely to be my video card or the Blizzard servers? I don't see that problem anywhere else or in any other program. I'm considering buying a better video card, but no point wasting money for it if that's not the problem.

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The first thing I would look at is if your game is compatible with Windows 8.1. After that I would check to see if there are issues with your video card/drivers. You may find info on this on the Blizzard forums. If there is a newer version of the drivers for your video you might want to update.

It seems to me like a connection problem of some kind. It's possible that there is a bug with the game, with its server communication protocols, or with its compatibility with Win-8.1.

At least, make sure everything is up-to-date, that includes: Windows, graphics drivers, the game, and DirectX. If the problem persists, I think that it would be an issue to report to Blizzard. I assume it hasn't always been like that, right? If it used to work better before, then the problem is most likely due to the Win-8.1 update or a bad driver or a recent bug in the game that needs fixing.

Don't buy a new graphics card, it's extremely unlikely that this is a hardware problem, or that you have insufficient capabilities, because that box seems to be packing some serious punch.

I updated Nvidia drivers but that didn't fix the problem.

Your stuttering and speeding up issue, is more than likely the connection between you and the server. That's probably not something you can fix unless it's a problem with your router.

As for the freezing up issue, I also use 8.1 and have had no issues. What I have found, however, is that it makes the graphics card very hot for no particular reason (that I can see, it's not doing anything particularly complicated).
If you can, use the EVGA PrecisionX tool and clock your fan at 100% before you start the game and if possible (if you have a second monitor for example) keep an eye on the temperature of the card. If it doesn't crash, the problem is that your fan auto-speed isn't getting high enough to cool your card down.
I have to admit though, that this is unlikely to be the problem. If you were overheating enough for a driver crash, you'd probably get some screen flicker rather than a hang.

Have you tried re-installing the game? It's possible some of the files may be corrupted.

Have you tried asking the NSA to ease up on its monitoring of your activity?

Lag is almost always network related. Sometimes simply resetting your router will cause things to get better, sometimes you're stuffed because there's some upstream problem.
Some games let you throttle the amount of data the client will accept, effectively telling the server "I can only receive x bytes per second, please don't send more".
If D3 has that, reducing that value might give relief, but at the potential loss of things in the game environment (things rendered on the server but not critical).

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